tzor at [unixtime wrote:1185971551[/unixtime]]Gandalf doesn't "defeat" the balrog, gravity defeats the balrog after a very long fall. Note also that Galdalf also dies.
Unless we assume that Gandalf is lying to seem more impressive, he does report that after the fall, he and the Balrog have an epic chase scene through the bowels of the earth and up a staircase taller than a mountain, followed by a mountaintop battle.
'But what would they say in song? Those that looked up from afar thought that the mountain was crowned with storm. Thunder they heard, and lightning, they said, smote upon Celebdil, and leaped back broken into tongues of fire. Is not that enough? A great smoke rose about us, vapour and steam. Ice fell like rain. I threw down my enemy and he fell from the high place and broke the mountain-side where he smote it in his ruin.'
Yes, Gandalf dies. Yes, most of Gandalf's magic is not that impressive to look at. Still, when your one-on-one duel can be mistaken for a thunderstorm and your enemy's defeat breaks a mountainside, that's a pretty objective measure of significant badass.